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Mylan NV (NAS:MYL)
Beneish M-Score
-2.17 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Mylan NV has a M-score of -2.17 signals that the company is a manipulator.

MYL' s 10-Year Beneish M-Score Range
Min: -4.35   Max: -0.52
Current: -2.17

-4.35
-0.52

During the past 13 years, the highest Beneish M-Score of Mylan NV was -0.52. The lowest was -4.35. And the median was -2.48.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Mylan NV for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.1979+0.528 * 0.9595+0.404 * 0.9563+0.892 * 1.1262+0.115 * 0.9585
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0803+4.679 * -0.0038-0.327 * 0.7345
=-2.17

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $2,265 Mil.
Revenue was 1871.7 + 2082.7 + 2084 + 1837.3 = $7,876 Mil.
Gross Profit was 830.1 + 969 + 1012.4 + 808.8 = $3,620 Mil.
Total Current Assets was $7,426 Mil.
Total Assets was $22,124 Mil.
Property, Plant and Equipment(Net PPE) was $1,872 Mil.
Depreciation, Depletion and Amortization(DDA) was $606 Mil.
Selling, General & Admin. Expense(SGA) was $1,731 Mil.
Total Current Liabilities was $5,288 Mil.
Long-Term Debt was $5,750 Mil.
Net Income was 56.6 + 189.2 + 499.1 + 125.2 = $870 Mil.
Non Operating Income was -18.5 + -38.1 + 1.5 + -3.7 = $-59 Mil.
Cash Flow from Operations was 267 + 126.6 + 440.7 + 179.4 = $1,014 Mil.
Accounts Receivable was $1,679 Mil.
Revenue was 1715.6 + 1808.5 + 1767.4 + 1701.7 = $6,993 Mil.
Gross Profit was 737.8 + 795.9 + 808.5 + 742.4 = $3,085 Mil.
Total Current Assets was $4,342 Mil.
Total Assets was $15,355 Mil.
Property, Plant and Equipment(Net PPE) was $1,705 Mil.
Depreciation, Depletion and Amortization(DDA) was $522 Mil.
Selling, General & Admin. Expense(SGA) was $1,423 Mil.
Total Current Liabilities was $2,649 Mil.
Long-Term Debt was $7,781 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(2264.6 / 7875.7) / (1678.6 / 6993.2)
=0.28754269 / 0.24003318
=1.1979

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(969 / 6993.2) / (830.1 / 7875.7)
=0.44108563 / 0.45967977
=0.9595

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (7426.4 + 1872.3) / 22123.8) / (1 - (4342.2 + 1705) / 15355)
=0.57969698 / 0.60617388
=0.9563

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7875.7 / 6993.2
=1.1262

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(522.3 / (522.3 + 1705)) / (606.4 / (606.4 + 1872.3))
=0.23449917 / 0.24464437
=0.9585

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1731.2 / 7875.7) / (1422.9 / 6993.2)
=0.21981538 / 0.20346908
=1.0803

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((5750.4 + 5288) / 22123.8) / ((7780.6 + 2649.3) / 15355)
=0.4989378 / 0.67925106
=0.7345

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(870.1 - -58.8 - 1013.7) / 22123.8
=-0.0038

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Mylan NV has a M-score of -2.17 signals that the company is likely to be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Mylan NV Annual Data

Mar05Mar06Mar07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.70650.81211.12811.04311.06940.87571.09620.98281.15181.1156
GMI 1.1150.99650.95381.2990.98921.00130.97280.97720.97250.9629
AQI 0.83951.1471.86912.18320.99850.99110.98930.95771.07730.7689
SGI 0.91181.0031.28213.18740.99131.07021.12461.10871.01661.1173
DEPI 1.18231.14441.25550.28791.08471.01630.91751.00411.18880.982
SGAI 1.40950.86720.74591.53341.00560.96680.99391.04020.98911.033
LVGI 1.15344.09761.08981.16410.96270.98791.09480.94031.0931.0073
TATA -0.0169-0.1273-0.0642-0.0554-0.0365-0.0479-0.0145-0.0261-0.0267-0.0025
M-score -2.09-4.16-2.04-0.34-2.58-2.75-2.41-2.54-2.44-2.40

Mylan NV Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.98280.90151.00631.10841.15181.08471.02620.9251.11561.1979
GMI 0.97720.98480.96820.97220.97250.97110.98020.97140.96290.9595
AQI 0.95770.95060.95250.97311.07731.10621.11660.91230.76890.9563
SGI 1.10871.09251.07521.03321.01661.02181.03951.09111.11731.1262
DEPI 1.00411.00591.02351.12651.18881.19231.18651.08080.9820.9585
SGAI 1.04021.01930.96970.99730.98070.98371.05991.04971.04181.0803
LVGI 0.94031.1851.00211.07871.0930.92451.01161.03951.00730.7345
TATA -0.0261-0.0456-0.0307-0.0235-0.0267-0.0372-0.0398-0.0249-0.0025-0.0038
M-score -2.54-2.79-2.58-2.50-2.44-2.48-2.56-2.65-2.41-2.17
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